Wednesday, August 25, 2010

Waiting on the Arcade Building

There's nothing terribly exciting in the City's RFP for the Arcade Building - it's mostly standard boilerplate stuff.  One item, however, did stand out:
The City has a strong preference for office space on upper floors and retail uses in the arcade section (first and second floors) that contribute to the quality of the streetscape; however, other uses will be considered.  Additionally, proposals which include plans to seek Leadership in Energy & Environmental Design (LEED) certification are encouraged.
I have to think that a mix of residential and office space (along with retail space in the two-story arcade) would work better than an all-office concept. The building does total 500,000 sf, after all.  And if renovated as office space, it will be competing for tenants with the Railway Exchange building, which is slated to undergo renovation soon.  Just how big is the market for office space in renovated historic buildings as compared to newer Class A and B buildings?

It will be interesting to see who responds to the RFP (last I heard, 2-3 firms were interested in it) and what ideas the respondents have for the building's reuse. The deadline to respond is September 30, so hopefully this fall we'll have a clearer picture of the Arcade's future.  It's the lynchpin of the Old Post Office district and arguably the most prominent vacant building downtown, now that St. Louis Centre and the Kiel Opera House are being renovated.

Tuesday, August 24, 2010

Downtown: The Path of Least Resistance?

It seems that the people of O'Fallon, Missouri are unhappy about the financial incentives their city is offering to Centene, to assist the company in building a new data center.

I have to think that downtown St. Louis would welcome the firm with open arms.  Centene could easily locate its data center downtown, taking advantage of downtown's outstanding power infrastructure while alleviating the need to build a new building, which would likely reduce costs.  The project wouldn't yield many jobs, but would be good for downtown's burgeoning IT sector.

How about it, Centene?

Monday, August 23, 2010

Filling Met Square, Part II

After suffering the loss of Armstrong Teasdale, one of its largest tenants, Met Square continues to rebuild its occupancy rate, adding one new tenant from across the street and another from across town.

Insurance defense law firm Evans & Dixon has leased nearly 40,000 sf on floors 24 and 25 for its 116 employees.  They're moving from 33,000 sf on three floors at the Millennium Center at 515 Olive and a smaller office at 705 Olive.

Favorable rental rates facilitated the firm's step up from a Class B building to Class A space, and the move now opens up a significant block of space for a value-minded tenant in the Millennium Center.  Space in the building leases for $12.00 psf - a true bargain in a recently renovated building with a great location.

Met Square is also adding the Better Business Bureau, which is relocating its 32 employees from Maplewood to a 6,700 sf space.

Wednesday, August 18, 2010

Brookdale Farms to Open Stables in Chouteau's Landing

Brookdale Farms, which runs downtown's popular carriage ride service, recently purchased the 20,903 sf building at 218 Lombard Street to house its 10 horses and carriages when they're not being kept at Brookdale's stables in Eureka.

Brookdale will be renovating the building, which is located next to I-44 in the Chouteau's Landing district.

For prospective tenants looking for a well located small office and warehouse facility, an adjacent building is currently listed for sale for $350,000.

Tuesday, August 17, 2010

Meanwhile, in the Motor City...

In Detroit, a city whose downtown has experienced a similar decline to our own (albeit on a much larger scale), there is reason for optimism thanks to two major employers who have decided to move downtown from the suburbs.

First, Blue Cross Blue Shield of Michigan announced that it would be moving 3,000 employees downtown from Southfield. That announcement was followed by Quicken Loans' decision to relocate its headquarters to downtown Detroit from Livonia, a move that will eventually bring 1,700 employees to the CBD.

The first wave of Quicken Loans employees began made the move downtown this week. Dan Gilbert, Quicken Loans' chairman and founder, addressed the employees on their first day downtown, saying, "For those of you who've never worked in a real downtown, there's something special about it. It will fuel us with a special energy." (No word as to whether his speech was written in Comic Sans.)

Gilbert really hit the nail on the head - downtown really does offer an energy that can't be found in the suburbs. It's just as true in Detroit and St. Louis as it is in Chicago and San Francisco.

Detroit's business leaders seem to be figuring out that their city's urban core is crucial to their region's survival. I hope our own business leaders can figure it out as well. If Detroit can do it, certainly St. Louis can as well.

Can you imagine 4,700 employees moving downtown? I sure can.

Monday, August 09, 2010

Downtown: It's Worth the Drive

A few weeks ago, the Business Journal ran a story about Gateway Packaging, a local, family-owned business based in Granite City that recently sold a 75 percent stake to a private equity firm in order to raise money for future acquisitions.  Gateway's CEO, Roger Miller, hopes to eventually increase sales to $300 million, from $79 million in 2009.

Buried in the article was this brief mention of the company's future office space needs:

If the company expands to $150 million to $250 million in sales, Miller said he might open a corporate office in Clayton, where he lives.

This took me back to a speech given by Mark Mantovani, CEO of downtown-based NSI, at the Partnership for Downtown St. Louis' annual meeting in July. To paraphrase, he stated that local CEOs need to locate their businesses based on what's best for the region - and strengthening our downtown is one of the easiest ways to improve our region - instead of choosing an office that's simply close to their homes.

Hopefully Mr. Miller will give downtown a shot when it comes time to lease space for his growing business; I'm sure he'd be welcomed with open arms! The impact his firm could have on the downtown renaissance would certainly be worth a few minutes' extra drive time.